Hoffa's Top Aide Repays $69,500 Embezzled From Union

Posted on March 15, 2007

February 17, 2005: On January 14, TDU urged Judge Loretta Preska to review a deal that gave James Hoffa’s executive assistant only a slap on the wrist for embezzling $69,500 from our union over a nearly three-year period.

Carlow Scalf, one of the most powerful officials in the union, got the deal with the Teamster Independent Review Board (IRB). The IRB agreed that Scalf would take a 60-day suspension and repay the $69,500 as the sole punishment for filing false reports and receiving 34 months of illegal payments. The payments were a special housing benefit, one that the Hoffa administration established for three persons: Scalf, Hoffa and General Secretary-Treasurer Keegel. Scalf accepted the money, claiming he lived in Michigan when in fact he no longer maintained a residence there.

In a six-page submission to Judge Preska, TDU asked the court to call for an explanation of the extraordinarily light punishment. TDU’s letter to the judge is available at www.tdu.org.

On Feb. 1 the U.S. Attorney submitted to the court a response, taking the position that the IRB has the power to make such a deal as a “compromise agreement,” and that the IRB may have had good reason to do so. The U.S. Attorney’s letter acknowledged, however, that Scalf received “one of [the IRB’s] most lenient sanctions to date,” and that Judge Preska could ask for an investigative report from the IRB.

Scalf will be eligible to come back to his $187,475-a-year position on March 13. The IBT’s PR department released a statement saying Hoffa is reviewing Scalf’s future with the Teamsters.

What Happened to Hoffa’s Little Investigation? Nearly a year ago, in April 2004, the Teamsters union’s highly advertised RISE anti-corruption program collapsed when its director Ed Stier resigned because, he said, Hoffa and Scalf were responsible for blocking the anti-corruption program.

Hoffa then named Ed McDonald as a new investigator to review Stier’s reports and his investigation into criminal influence at Chicago Teamster locals. After ten months, what has McDonald done, and where is his report?

TDU has learned that McDonald is billing our union some $500 per hour. It would seem that a report is owed to the members for that kind of money.

McDonald’s other clients include one of the nation’s largest waste management corporations (an industry including major Teamster employers), domestic and foreign bank officials, other large financial institutions and their employees, a member of the Saudi Royal family, international businessmen, and the former chairman and deputy chairman of the Russian Securities Commission.

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